Does Financial Structure Matter for Poverty? Evidence from Developing Countries

Although there has been research looking at the relationship between the structure of the financial system and economic growth, much less work has dealt with the importance of bank-based versus market-based financial systems for poverty and income...

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Bibliographic Details
Main Authors: Kpodar, Kangni, Singh, Raju Jan
Format: Policy Research Working Paper
Language:English
Published: 2012
Subjects:
GDP
M2
M3
Online Access:http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111213133824
http://hdl.handle.net/10986/3685
id okr-10986-3685
recordtype oai_dc
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic ACCESS TO CREDIT
ACCESS TO EDUCATION
ACCESS TO FINANCE
ACCESS TO MARKETS
ACCESS TO SERVICES
ACCOUNTING
ADVANCED COUNTRIES
ADVERSE SELECTION
AGRICULTURAL SECTOR
AMOUNT OF COLLATERAL
BAD BANKS
BANK ASSETS
BANK BRANCH
BANK BRANCHES
BANK CREDIT
BANK LOANS
BANK POLICY
BANKING CONCENTRATION
BANKING SECTOR
BANKING SECTOR DEVELOPMENT
BANKING SECTOR EFFICIENCY
BANKING SYSTEM
BANKING SYSTEMS
BASIC NEEDS
BOND
BORROWING
CAPITAL ALLOCATION
CAPITALIZATION
CENTRAL BANKS
CHILD LABOR
CLEAN WATER
COLLATERAL
COMMERCIAL BANK
COMMERCIAL BANK ASSETS
COMMERCIAL BANKS
CONSUMER PRICE INDEX
CONTRACT ENFORCEMENT
CORPORATE FINANCE
COUNTRY COMPARISONS
COUNTRY RISK
CREDIT CONSTRAINTS
CREDIT GROWTH
CREDIT MARKET
CREDIT MARKETS
CREDIT RATIONING
CREDITOR
CREDITOR RIGHTS
CURRENCY
DEBT
DEFAULTS
DEPOSIT
DEPOSIT INSURANCE
DEPOSIT MONEY BANKS
DEPOSITS
DEREGULATION
DEVELOPING COUNTRIES
DEVELOPING ECONOMIES
DEVELOPMENT BANKING
DEVELOPMENT ECONOMICS
DEVELOPMENT POLICY
DISCRIMINATION
DISTRIBUTION OF INCOME
DOMESTIC EQUITIES
DOMESTIC EXCHANGES
DURABLE
DURABLE ASSETS
EARNINGS
ECONOMETRICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC OPPORTUNITIES
ECONOMIC PERFORMANCE
ECONOMIC RESEARCH
ECONOMIC THEORY
EDUCATION LEVEL
EMPLOYMENT
ENROLMENT RATE
ENTREPRENEUR
ENTREPRENEURS
EQUITY MARKETS
EXPECTED RETURN
EXPORTS
FINANCIAL DEEPENING
FINANCIAL DEPTH
FINANCIAL DEVELOPMENT
FINANCIAL INSTITUTION
FINANCIAL INSTITUTIONS
FINANCIAL INSTRUMENTS
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIARY
FINANCIAL INTERMEDIATION
FINANCIAL LIBERALIZATION
FINANCIAL MARKETS
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SECTOR REFORMS
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL STUDIES
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FIXED COST
FORMAL FINANCIAL INSTITUTIONS
FORMAL FINANCIAL SECTOR
FUTURE EARNINGS
GDP
GDP PER CAPITA
GINI COEFFICIENT
GOVERNMENT EXPENDITURES
GREATER ACCESS
GROWTH MODELS
HEALTH SERVICES
HIGH INTEREST RATES
HOUSEHOLD INCOME
HOUSEHOLDS
HOUSING
HUMAN CAPITAL
HUMAN DEVELOPMENT
INCOME DISTRIBUTION
INCOME INEQUALITIES
INCOME INEQUALITY
INCOME LEVELS
INCOME VARIABILITY
INCOMES
INDIVIDUAL INVESTORS
INEFFICIENCY
INFLATION
INFLATION RATE
INFLATION RATES
INFORMATION ASYMMETRIES
INFORMATION ASYMMETRY
INFORMATION ON BORROWERS
INFORMATION SHARING
INFRASTRUCTURE DEVELOPMENT
INSTITUTIONAL DEVELOPMENT
INSTITUTIONAL ENVIRONMENT
INSTITUTIONAL REFORMS
INSTRUMENT
INTEREST RATE
INTEREST RATES
INTERNATIONAL BANK
INTERNATIONAL FINANCIAL STATISTICS
JOB CREATION
JOB OPPORTUNITIES
LABOR MARKETS
LACK OF ACCESS
LEGAL RIGHTS
LEGAL SYSTEM
LEGAL SYSTEMS
LENDER
LENDERS
LIQUIDITY
LOAN
LOAN-TO-DEPOSIT RATIO
LORENZ CURVE
M2
M3
MACROECONOMIC ENVIRONMENT
MACROECONOMIC VARIABLES
MACROECONOMICS
MARKET CONSTRAINTS
MARKET EFFICIENCY
MARKET LIQUIDITY
MARKET VALUE
MICRO DATA
MICROFINANCE
MIDDLE-INCOME COUNTRIES
MONETARY FUND
NET INTEREST MARGIN
OVERHEAD COST
OVERHEAD COSTS
PER CAPITA INCOME
POLITICAL ECONOMY
POOL OF BORROWERS
POVERTY ALLEVIATION
PRICE STABILITY
PRIVATE CREDIT
PRIVATE PROPERTY
PRIVATE SECTOR CREDIT
PROBABILITY OF REPAYMENT
PROFITABILITY
PROPERTY RIGHT
PROPERTY RIGHTS
PRUDENTIAL REQUIREMENTS
REMITTANCES
RESOURCE ALLOCATION
RETURN
RISK DIVERSIFICATION
RISK SHARING
RULE OF LAW
RURAL BANK
RURAL BANK BRANCHES
RURAL BANKS
SAVINGS
SHAREHOLDER
SHAREHOLDER PROTECTION
SKILLED WORKERS
SMALL ENTERPRISES
SOCIAL BANKING
STOCK MARKET
STOCK MARKET CAPITALIZATION
STOCK MARKET DEVELOPMENT
STOCK MARKET DEVELOPMENTS
STOCK MARKETS
TRADE LIBERALIZATION
TRANSACTION
TRANSACTION COSTS
TRANSPARENCY
TURNOVER
VILLAGES
WAGE RATES
WAGES
WEALTH
WORLD DEVELOPMENT INDICATORS
spellingShingle ACCESS TO CREDIT
ACCESS TO EDUCATION
ACCESS TO FINANCE
ACCESS TO MARKETS
ACCESS TO SERVICES
ACCOUNTING
ADVANCED COUNTRIES
ADVERSE SELECTION
AGRICULTURAL SECTOR
AMOUNT OF COLLATERAL
BAD BANKS
BANK ASSETS
BANK BRANCH
BANK BRANCHES
BANK CREDIT
BANK LOANS
BANK POLICY
BANKING CONCENTRATION
BANKING SECTOR
BANKING SECTOR DEVELOPMENT
BANKING SECTOR EFFICIENCY
BANKING SYSTEM
BANKING SYSTEMS
BASIC NEEDS
BOND
BORROWING
CAPITAL ALLOCATION
CAPITALIZATION
CENTRAL BANKS
CHILD LABOR
CLEAN WATER
COLLATERAL
COMMERCIAL BANK
COMMERCIAL BANK ASSETS
COMMERCIAL BANKS
CONSUMER PRICE INDEX
CONTRACT ENFORCEMENT
CORPORATE FINANCE
COUNTRY COMPARISONS
COUNTRY RISK
CREDIT CONSTRAINTS
CREDIT GROWTH
CREDIT MARKET
CREDIT MARKETS
CREDIT RATIONING
CREDITOR
CREDITOR RIGHTS
CURRENCY
DEBT
DEFAULTS
DEPOSIT
DEPOSIT INSURANCE
DEPOSIT MONEY BANKS
DEPOSITS
DEREGULATION
DEVELOPING COUNTRIES
DEVELOPING ECONOMIES
DEVELOPMENT BANKING
DEVELOPMENT ECONOMICS
DEVELOPMENT POLICY
DISCRIMINATION
DISTRIBUTION OF INCOME
DOMESTIC EQUITIES
DOMESTIC EXCHANGES
DURABLE
DURABLE ASSETS
EARNINGS
ECONOMETRICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC OPPORTUNITIES
ECONOMIC PERFORMANCE
ECONOMIC RESEARCH
ECONOMIC THEORY
EDUCATION LEVEL
EMPLOYMENT
ENROLMENT RATE
ENTREPRENEUR
ENTREPRENEURS
EQUITY MARKETS
EXPECTED RETURN
EXPORTS
FINANCIAL DEEPENING
FINANCIAL DEPTH
FINANCIAL DEVELOPMENT
FINANCIAL INSTITUTION
FINANCIAL INSTITUTIONS
FINANCIAL INSTRUMENTS
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIARY
FINANCIAL INTERMEDIATION
FINANCIAL LIBERALIZATION
FINANCIAL MARKETS
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SECTOR REFORMS
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL STUDIES
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FIXED COST
FORMAL FINANCIAL INSTITUTIONS
FORMAL FINANCIAL SECTOR
FUTURE EARNINGS
GDP
GDP PER CAPITA
GINI COEFFICIENT
GOVERNMENT EXPENDITURES
GREATER ACCESS
GROWTH MODELS
HEALTH SERVICES
HIGH INTEREST RATES
HOUSEHOLD INCOME
HOUSEHOLDS
HOUSING
HUMAN CAPITAL
HUMAN DEVELOPMENT
INCOME DISTRIBUTION
INCOME INEQUALITIES
INCOME INEQUALITY
INCOME LEVELS
INCOME VARIABILITY
INCOMES
INDIVIDUAL INVESTORS
INEFFICIENCY
INFLATION
INFLATION RATE
INFLATION RATES
INFORMATION ASYMMETRIES
INFORMATION ASYMMETRY
INFORMATION ON BORROWERS
INFORMATION SHARING
INFRASTRUCTURE DEVELOPMENT
INSTITUTIONAL DEVELOPMENT
INSTITUTIONAL ENVIRONMENT
INSTITUTIONAL REFORMS
INSTRUMENT
INTEREST RATE
INTEREST RATES
INTERNATIONAL BANK
INTERNATIONAL FINANCIAL STATISTICS
JOB CREATION
JOB OPPORTUNITIES
LABOR MARKETS
LACK OF ACCESS
LEGAL RIGHTS
LEGAL SYSTEM
LEGAL SYSTEMS
LENDER
LENDERS
LIQUIDITY
LOAN
LOAN-TO-DEPOSIT RATIO
LORENZ CURVE
M2
M3
MACROECONOMIC ENVIRONMENT
MACROECONOMIC VARIABLES
MACROECONOMICS
MARKET CONSTRAINTS
MARKET EFFICIENCY
MARKET LIQUIDITY
MARKET VALUE
MICRO DATA
MICROFINANCE
MIDDLE-INCOME COUNTRIES
MONETARY FUND
NET INTEREST MARGIN
OVERHEAD COST
OVERHEAD COSTS
PER CAPITA INCOME
POLITICAL ECONOMY
POOL OF BORROWERS
POVERTY ALLEVIATION
PRICE STABILITY
PRIVATE CREDIT
PRIVATE PROPERTY
PRIVATE SECTOR CREDIT
PROBABILITY OF REPAYMENT
PROFITABILITY
PROPERTY RIGHT
PROPERTY RIGHTS
PRUDENTIAL REQUIREMENTS
REMITTANCES
RESOURCE ALLOCATION
RETURN
RISK DIVERSIFICATION
RISK SHARING
RULE OF LAW
RURAL BANK
RURAL BANK BRANCHES
RURAL BANKS
SAVINGS
SHAREHOLDER
SHAREHOLDER PROTECTION
SKILLED WORKERS
SMALL ENTERPRISES
SOCIAL BANKING
STOCK MARKET
STOCK MARKET CAPITALIZATION
STOCK MARKET DEVELOPMENT
STOCK MARKET DEVELOPMENTS
STOCK MARKETS
TRADE LIBERALIZATION
TRANSACTION
TRANSACTION COSTS
TRANSPARENCY
TURNOVER
VILLAGES
WAGE RATES
WAGES
WEALTH
WORLD DEVELOPMENT INDICATORS
Kpodar, Kangni
Singh, Raju Jan
Does Financial Structure Matter for Poverty? Evidence from Developing Countries
geographic_facet The World Region
The World Region
relation Policy Research working paper ; no. WPS 5915
description Although there has been research looking at the relationship between the structure of the financial system and economic growth, much less work has dealt with the importance of bank-based versus market-based financial systems for poverty and income distribution. Empirical evidence has indicated that the structure of the financial system has little relevance for economic growth, suggesting that the same could be true for poverty since growth is an important driver in reducing poverty. Some theories, however, claim that, by reducing information and transaction costs, the development of bank-based financial systems could exert a particularly large impact on the poor. This paper looks at a sample of 47 developing economies from 1984 through 2008. The results suggest that when institutions are weak, bank-based financial systems are better at reducing poverty and, as institutions develop, market-based financial systems can turn out to be beneficial for the poor.
format Publications & Research :: Policy Research Working Paper
author Kpodar, Kangni
Singh, Raju Jan
author_facet Kpodar, Kangni
Singh, Raju Jan
author_sort Kpodar, Kangni
title Does Financial Structure Matter for Poverty? Evidence from Developing Countries
title_short Does Financial Structure Matter for Poverty? Evidence from Developing Countries
title_full Does Financial Structure Matter for Poverty? Evidence from Developing Countries
title_fullStr Does Financial Structure Matter for Poverty? Evidence from Developing Countries
title_full_unstemmed Does Financial Structure Matter for Poverty? Evidence from Developing Countries
title_sort does financial structure matter for poverty? evidence from developing countries
publishDate 2012
url http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111213133824
http://hdl.handle.net/10986/3685
_version_ 1764387806680973312
spelling okr-10986-36852021-04-23T14:02:11Z Does Financial Structure Matter for Poverty? Evidence from Developing Countries Kpodar, Kangni Singh, Raju Jan ACCESS TO CREDIT ACCESS TO EDUCATION ACCESS TO FINANCE ACCESS TO MARKETS ACCESS TO SERVICES ACCOUNTING ADVANCED COUNTRIES ADVERSE SELECTION AGRICULTURAL SECTOR AMOUNT OF COLLATERAL BAD BANKS BANK ASSETS BANK BRANCH BANK BRANCHES BANK CREDIT BANK LOANS BANK POLICY BANKING CONCENTRATION BANKING SECTOR BANKING SECTOR DEVELOPMENT BANKING SECTOR EFFICIENCY BANKING SYSTEM BANKING SYSTEMS BASIC NEEDS BOND BORROWING CAPITAL ALLOCATION CAPITALIZATION CENTRAL BANKS CHILD LABOR CLEAN WATER COLLATERAL COMMERCIAL BANK COMMERCIAL BANK ASSETS COMMERCIAL BANKS CONSUMER PRICE INDEX CONTRACT ENFORCEMENT CORPORATE FINANCE COUNTRY COMPARISONS COUNTRY RISK CREDIT CONSTRAINTS CREDIT GROWTH CREDIT MARKET CREDIT MARKETS CREDIT RATIONING CREDITOR CREDITOR RIGHTS CURRENCY DEBT DEFAULTS DEPOSIT DEPOSIT INSURANCE DEPOSIT MONEY BANKS DEPOSITS DEREGULATION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT BANKING DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DISCRIMINATION DISTRIBUTION OF INCOME DOMESTIC EQUITIES DOMESTIC EXCHANGES DURABLE DURABLE ASSETS EARNINGS ECONOMETRICS ECONOMIC ACTIVITY ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC OPPORTUNITIES ECONOMIC PERFORMANCE ECONOMIC RESEARCH ECONOMIC THEORY EDUCATION LEVEL EMPLOYMENT ENROLMENT RATE ENTREPRENEUR ENTREPRENEURS EQUITY MARKETS EXPECTED RETURN EXPORTS FINANCIAL DEEPENING FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL INSTITUTION FINANCIAL INSTITUTIONS FINANCIAL INSTRUMENTS FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIARY FINANCIAL INTERMEDIATION FINANCIAL LIBERALIZATION FINANCIAL MARKETS FINANCIAL SECTOR DEVELOPMENT FINANCIAL SECTOR REFORMS FINANCIAL SERVICES FINANCIAL STRUCTURE FINANCIAL STUDIES FINANCIAL SYSTEM FINANCIAL SYSTEMS FIXED COST FORMAL FINANCIAL INSTITUTIONS FORMAL FINANCIAL SECTOR FUTURE EARNINGS GDP GDP PER CAPITA GINI COEFFICIENT GOVERNMENT EXPENDITURES GREATER ACCESS GROWTH MODELS HEALTH SERVICES HIGH INTEREST RATES HOUSEHOLD INCOME HOUSEHOLDS HOUSING HUMAN CAPITAL HUMAN DEVELOPMENT INCOME DISTRIBUTION INCOME INEQUALITIES INCOME INEQUALITY INCOME LEVELS INCOME VARIABILITY INCOMES INDIVIDUAL INVESTORS INEFFICIENCY INFLATION INFLATION RATE INFLATION RATES INFORMATION ASYMMETRIES INFORMATION ASYMMETRY INFORMATION ON BORROWERS INFORMATION SHARING INFRASTRUCTURE DEVELOPMENT INSTITUTIONAL DEVELOPMENT INSTITUTIONAL ENVIRONMENT INSTITUTIONAL REFORMS INSTRUMENT INTEREST RATE INTEREST RATES INTERNATIONAL BANK INTERNATIONAL FINANCIAL STATISTICS JOB CREATION JOB OPPORTUNITIES LABOR MARKETS LACK OF ACCESS LEGAL RIGHTS LEGAL SYSTEM LEGAL SYSTEMS LENDER LENDERS LIQUIDITY LOAN LOAN-TO-DEPOSIT RATIO LORENZ CURVE M2 M3 MACROECONOMIC ENVIRONMENT MACROECONOMIC VARIABLES MACROECONOMICS MARKET CONSTRAINTS MARKET EFFICIENCY MARKET LIQUIDITY MARKET VALUE MICRO DATA MICROFINANCE MIDDLE-INCOME COUNTRIES MONETARY FUND NET INTEREST MARGIN OVERHEAD COST OVERHEAD COSTS PER CAPITA INCOME POLITICAL ECONOMY POOL OF BORROWERS POVERTY ALLEVIATION PRICE STABILITY PRIVATE CREDIT PRIVATE PROPERTY PRIVATE SECTOR CREDIT PROBABILITY OF REPAYMENT PROFITABILITY PROPERTY RIGHT PROPERTY RIGHTS PRUDENTIAL REQUIREMENTS REMITTANCES RESOURCE ALLOCATION RETURN RISK DIVERSIFICATION RISK SHARING RULE OF LAW RURAL BANK RURAL BANK BRANCHES RURAL BANKS SAVINGS SHAREHOLDER SHAREHOLDER PROTECTION SKILLED WORKERS SMALL ENTERPRISES SOCIAL BANKING STOCK MARKET STOCK MARKET CAPITALIZATION STOCK MARKET DEVELOPMENT STOCK MARKET DEVELOPMENTS STOCK MARKETS TRADE LIBERALIZATION TRANSACTION TRANSACTION COSTS TRANSPARENCY TURNOVER VILLAGES WAGE RATES WAGES WEALTH WORLD DEVELOPMENT INDICATORS Although there has been research looking at the relationship between the structure of the financial system and economic growth, much less work has dealt with the importance of bank-based versus market-based financial systems for poverty and income distribution. Empirical evidence has indicated that the structure of the financial system has little relevance for economic growth, suggesting that the same could be true for poverty since growth is an important driver in reducing poverty. Some theories, however, claim that, by reducing information and transaction costs, the development of bank-based financial systems could exert a particularly large impact on the poor. This paper looks at a sample of 47 developing economies from 1984 through 2008. The results suggest that when institutions are weak, bank-based financial systems are better at reducing poverty and, as institutions develop, market-based financial systems can turn out to be beneficial for the poor. 2012-03-19T18:06:49Z 2012-03-19T18:06:49Z 2011-12-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111213133824 http://hdl.handle.net/10986/3685 English Policy Research working paper ; no. WPS 5915 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region